Not bad not bad, BTW when are thieves comming back from exile?.. I bet they must be drooling 7 X 24.
http://www.dailytimes.com.pk/default.asp?page=story_9-4-2004_pg5_1
Public companies’ expensive loans: Debt worth $1b to be prepaid by June
- $15.78b in expensive debt retired in three years
By Javed Mahmood
ISLAMABAD: The federal government is set to make a prepayment of about $1 billion in expensive foreign private debt of public sector corporations, a senior official at the finance ministry has said.
“We are in the process of identifying the most expensive debt obtained by the federal government-controlled corporations and companies that can be repaid prematurely by June 2004,” the official said.
He said the expensive debt of the corporations, guaranteed by the federal government, is to the tune of $1 billion and it carries mark up between 6-7 percent.
The official, however, said the prepayment of corporations debt can precede the proposed $1 billion premature payment of expensive loans owed to the World Bank and other multilateral donors.
He said the public corporations have obtained a major portion of the debt for trade purposes in the past.
Pakistan International Airlines Corporation (PIAC), Utility Stores Corporation, National Fertilisers Corporation (NFC), Karachi Electric Supply Company (KESC) and Oil and Gas Development Company are some of the state-run organisations with debt that can be retired ahead of schedule with a view to minimise debt burden.
Dr Ashfaque H Khan, economic adviser to the finance ministry, confirmed to Daily Times that the federal government had planned the premature payment of foreign private debt of corporations, carrying costly mark-up.
“We are identifying expensive foreign debt irrespective of the fact that it may belong to the World Bank, IMF or any other multilateral lending agency,” said Dr Khan.
“Our motto is to find out the most expensive debt and repay it ahead of its schedule with the aim to reduce debt burden on the country and to contain its growth in future.’’
$15.78b already retired: Dr Khan said in the past three financial years the federal government has retired a huge amount of $15.738 billion foreign debt. In 2000-01 the government paid $5.101 billion foreign debt; $6.327 billion were paid in 2001-02 while $4.31 billion debt was retired in 2002-03, he said.
He pointed out during 2000-01 the federal government also got rescheduled $6.946 billion foreign debt - $2.795 billion rescheduling in 2000-01, $2.243 billion in 2001-02 and $1.908 billion in 2002-03. In the current fiscal the payment of foreign debt is expected to be in the range of $4 billion.
He said that during the past couple of years the quantum of external debt has dropped from $37 billion to $34.15 billion by December 31, 2003 mainly because of repayment and rescheduling of foreign liabilities.
Dr Khan said the federal government had estimated a total of $4 billion expensive foreign debt that will be retired in three years prematurely. He said recently the government had returned $1 billion in a costly loan to the Asian Development Bank while another $1 billion will be repaid within this calendar year.
He said the prepayment of the remaining $2 billion external debt will be arranged in 2005 and 2006 and added that all the high foreign exchange reserves of above $12.5 billion, growing exports, impressive inflow of remittances, foreign assistance, and sharp growth in tax revenue in last three years have enabled the federal government to opt for prepayment of expensive debt, apart from the payment of routine debt.
He said in future the government has decided not to obtain costly loans from any transnational donor agency. Only soft-term loans can be obtained from the World Bank, the Asian Development Bank and other donors, excluding the International Monetary Fund (IMF).